The Corporation of Lloyd’s, the body that oversees and supports the Lloyd’s market to ensure efficient operation, will find its headcount reduced by around 10% in the upcoming organisational restructure, Chief Executive Inga Beale said today.
In a half-yearly letter to employees and the Lloyd’s of London insurance and reinsurance market, Beale highlighted the need for cost reduction, increased efficiency and modernisation.
One of the initiatives seeking this within the Corporation of Lloyd’s itself is a planned organisational restructure. The redundancy drive had already been revealed to Lloyd’s staff some weeks ago, with many invited to apply for voluntary severance packages, but now Beale has revealed that a 10% cut in staff numbers is the target.
The Corporation of Lloyd’s employed somewhere around 1060 people, as of the end of 2016, a figure which increased by more than a hundred over the two years prior to that.
Now the Lloyd’s market is modernising and becoming more streamlined, and so the Corporation is seeking a shift to a new operational structure with the resulting reduction in headcount of around 10%.
Beale said that a new organisational structure will likely be rolled out in the fourth quarter of this year.
“As well as some internal reorganisation, this will involve a reduction in head count of around 10%. We are seeking to minimise the impact on our people by opening up a voluntary severance programme and through re-deployment within the organisation,” she explained.
Lloyd’s is facing the same issues as the rest of the insurance and reinsurance market right now, with competition and softened reinsurance pricing particularly a factor for the market and helping to increase the need for efficiency.
Additionally Lloyd’s faces softening in other specialty insurance markets and the general need for increased efficiency, as technology and new business models combine to threaten legacy players that fail to adapt.
So Lloyd’s is taking action and the unfortunate loss of jobs is just one way that efficiency can be gained, both through the new structure and a reduction in cost-base.
Eventually, we’d expect out re/insurers to also have to look at headcount, but right now the Lloyd’s market has perhaps one of the highest cost-bases in the market due to the way it operates, so taking steps now to reduce headcount is likely a prudent response to market conditions and ensuring Lloyd’s profitability continues.